[wonderthrowaway]

Great question.

To the parent to your post: look, when you're picking a job, you're essentially buying the stock with your time, if not with part of your comp. Unless you're a true W2 mercenary, you should accept upside at a discount like tptacek's hypothetical.

So the GP got burned in 2001? That's a dumb reason to swear off all exposure to life-changing upside, forever, no matter what the expected return.

Unless you are a mercenary or shark who has to keep moving, think like a savvy investor first. Then indulge your preference for the type of work. And only after all of that worry about the W2 money.

Successful companies will breed opportunity to do the kind of work you want. Successful companies will also build your equity and increase your base rate to eventually catch up to market. Growth will create professional opportunities. Pick based on the prospects of the company first.

ITT people are too focused on the salary negotiations that patio11 brought up, and not enough on the aspects that build true wealth. Don't get trapped in local optimizations...you have to create exposure to outsized upside. If not through equity, then through side-projects and entrepreneurial activity.

[fredkbloggs]

Your choice of words is telling: "mercenary" and "shark" are overwhelmingly negative. By characterising people who disagree with your assessment of equity that way, you risk being perceived as a confidence man. Con men sell hope to the greedy at a steep markup; they are perfectly willing to use guilt if that's what it takes to reel in the mark. Anything to get someone to buy into their schemes for their own profit; in this case, by accepting worthless scrip in lieu of proper compensation. If you don't want to be perceived as unscrupulous, you should reconsider how you characterise people with different values.

I didn't get burned in 2001. I watched a bunch of people who thought they were rich suddenly realise that not only were they not rich, they were also out of a job with no prospects, through no fault of their own. I wasn't personally harmed; I rather enjoyed paying 40% less rent and spending half as much time commuting. Nevertheless, it was a magnificent learning opportunity for a young engineer, just as the bursting of this bubble will be for others. For anyone who prefers to learn the easy way, the takeaways were:

1. The market price of your equity is determined by almost every conceivable factor except the merits of your own work.

2. So few companies succeed in a way that makes your equity of life-altering market value that you should approximate the probability as zero.

3. You will not live long enough to accumulate enough wisdom to beat the market; that is, you are not better than average at identifying early-stage companies that are much more likely than average to be successful as in (2).

4. More generally, humans don't live long enough for buying variance to be a good strategy unless you are desperately poor. Otherwise, sell variance any time you can do so ev-neutrally. If you simply must buy variance, pay as little ev as possible for it. Flips and roulette are good; the lottery and buying stock on margin are bad.

"Life-changing upside" changes very few lives, even fewer deservedly so. If we lived 100,000 years, it might make sense to take a few thousand gambles on early-stage startups; the variance would mostly work itself out, and after a while you might even be able to tell who's likely to succeed so that your choice of employers would be +ev. In one 40-year career, forget it. The path to true wealth consists first of an inexpensive lifestyle and second of salary maximisation. Higher ev, lower variance.

(first paragraph edited for tone)

[tptacek]

There's a way to make an argument without calling your counterparty a "con man". I'm more on your side than the parent's side (though the idea of valuing equity at zero is illogical). I think your comment would be stronger without its first paragraph.

[fredkbloggs]

There's a way to make his case without calling anyone who disagrees a "shark" or a "mercenary". In fact, I think his choice of language was quite revealing of the true origins of his position; if it is not, he would do well to reconsider how it is perceived by others.

[tptacek]

He didn't call you a mercenary. You did imply he was a con man. I know the difference seems subtle, but one is much worse than the other. Even if you disagree, two wrongs don't make a right.